Troubled New Orleans agency facing federal audit

December 19, 2017

NEW ORLEANS (AP) — The agency that oversees drainage, sewer and water systems in New Orleans faces an audit of its spending of federal money received following Hurricane Katrina.

New Orleans news outlets report that the Department of Homeland Security’s Office of Inspector General notified the Sewerage and Water Board of New Orleans of the planned audit in a letter. It was made public at a committee meeting Monday.

It says the audit is to determine whether the board spent and accounted for Federal Emergency Management Agency money in accordance with regulations and guidelines.

In statements Monday, the board and Mayor Mitch Landrieu’s office characterized the audit as routine.

“Audits are standard when it relates to the spending of federal funds,” Landrieu spokesman Craig Belden said in an email, adding that much of the Katrina-related funding the city received from FEMA and the Department of Housing and Urban Development has gone through some type of auditing.

The board, in a separate statement said such audits “are often standard practice to track federal spending.

The Sewerage and Water Board has been the focus of criticism and scrutiny since August flooding revealed problems with the city’s storm drainage system.

The new audit comes as the board faces a 2018 budget with questions about funding for maintenance, repairs and upgrades to the city’s drainage system.

The $346.5 million capital budget for 2018 presented to the board’s Finance Committee on Monday includes $83 million for drainage work. Federal funds will account for about $25 million of that, and the board will kick in another $1.8 million. But that leaves about $56 million in projects with a funding source “to be determined.”